On Wednesday, Goldman Sachs is set to announce 3rd quarter earnings. Estimates of its 2009 bonus pool are sure to accompany that announcement. In fact, the Telegraph is already on the case, predicting that Goldman will pay out more than $20 billion in bonuses the year after it received $10 billion in bailout funds. This would set a new record for Wall Street compensation.
The TARP funds have been paid back, but don’t begin to account for the billions in subsidies Goldman has received from US taxpayers, ranging from Fed lending to its conversion to bank holding company status (even though it doesn’t act like one).
This is an outrage, and Goldman knows it: the bank is apparently bracing itself for a media firestorm. Some folks are suggesting that the bank innoculate against the outcry by donating a percentage of its bonus pool to charity.
How about 100%? All of this bonus money, and much more, has been stolen from the American public. Goldman Sachs would not exist today were it not for the US government’s interventions on its behalf. And I’m talking about direct interventions to save Goldman itself, not just the TARP legislation that benefited the entire financial sector.
It boggles the mind.